Arianne Phosphate, Saguenay, Quebec, the development-stage phosphate mining company advancing the Lac à Paul project in Quebec’s Saguenay-Lac-Saint-Jean region, announced on Sept. 25 the formal execution of its first offtake agreement.
The unnamed buyer has entered into a long-term contract to purchase Arianne’s phosphate concentrate, which will be shipped to the buyer’s processing plant for further processing into downstream phosphate products. Arianne said the agreement also has a mechanism whereby it can be extended beyond the initial contract period and applies pricing that accounts for the high quality of Arianne’s concentrate.
“After a lot of hard work, this agreement represents a major milestone for our company,” said Brian Ostroff, Arianne Phosphate CEO. “Comprising part of our annual output, this agreement accomplishes many objectives. First, receiving an offtake from a well-known, bankable, industry player validates our product and confirms the marketability of it. Further, this agreement also confirms a pricing model that accounts for Arianne’s high-purity, low-contaminant concentrate. Lastly, we also now have a template on how to move from MOU to formal agreement and what it takes to get there.”
Arianne said it currently has several other MOUs in place and is working towards turning them into formal purchase agreements. It said their completion is a necessary component to formalize the company’s project financing and has become central to Arianne’s ongoing efforts to move its Lac à Paul project into development.